Wireless execs call for Senate action on tax bills, Digital Goods Act

CTIA is calling on the Senate to move forward on ending “discriminatory” taxes on wireless services as well as create a single taxation framework for digital media purchases.

In a letter signed by the chief executives of the six largest wireless carriers in the United States, plus CTIA head Steve Largent, the wireless association calls on Senate Finance Committee Chairman Max Baucus (D-Mont.) and ranking member Orrin Hatch (R-Utah) to pass out of committee the Wireless Tax Fairness Act, S. 543.

{mosads}The bill would impose a five-year moratorium on new taxes on wireless services, giving federal and state governments an opportunity to reform today’s “discriminatory tax system,” which taxes wireless services at 16.3 percent, compared with 7.4 percent for other goods and services. This disparity imposes an “unfair and regressive burden” on lower-income Americans, who rely on wireless services in disproportionate numbers.

The executives also urge Baucus and Hatch to take action on the Digital Goods and Services Tax Fairness Act, S. 971. This bill would impose a “clear framework” to govern purchases of digital goods such as ebooks, music or mobile apps that are downloaded to phones and tablets.

Currently there is a “lack of clarity” that could allow several jurisdictions to claim the right to tax such a transaction, the letter said. The framework the bill would impose is similar to the one set up by the Mobile Telecommunications Sourcing Act more than a decade ago.

“Only Congress is able to establish a framework providing much needed certainty for consumers, providers and the state and local governments seeking to tax digital commerce,” the letter said. 

Tags Max Baucus Orrin Hatch

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